Selling Your Home When You Owe More Than It Is Worth

Pensacola house values have declined since their peak in 2005-2006. Depending on when you purchased and the amount of your down payment, your home’s current value may be less than the amount you still owe on your mortgage principal. In other words, you might be upside-down. If you are upside down on your home's loan, and many people are these days, you have some options to consider.

There are only three things you can do if you are in this situation, and you want to sell:

1. Short Sale
   A short sale is when the lender agrees to a sale for less than the principal due. If you are behind in your mortgage payments and are facing the possibility of foreclosure, ask your mortgage lender to agree to a "short sale."
   
   
2. Bring money to closing
   If you do sell your home on today's market, you will need to bring funds equal to the difference between the sale price and the amount you still owe. This for many people can be tens to hundreds of thousands of dollars.
   
   
3. Wait to Sell
   Depending on how upside-down your home is this could take years. This is not a good option for those needing to sell sooner rather than years later.

How does a short sale work?

If you choose, sell your home using a short sale it pays to work with professionals. Now more than ever, mortgage lenders require homeowners that short sell their homes to sign an agreement to pay off the deficiency between the mortgage amount and the sales proceeds. This “deficiency judgment” is generally an unsecured note. The lack of collateral leads many people to believe that that there are no consequences in defaulting on this loan; this could not be further from the truth. While a short sale is less harmful to your credit rating than a foreclosure, defaulting on a deficiency judgment further harms your credit. It is of vital importance that you sell your home for market value. Selling your home for less than it is worth today could cost you for years to come.

How we can help sell your home through a short sale.

The national average for successful short sales is 23 percent, according to USA Today. Other sources quote up to 30 percent; that is less than one-third. My agents close 90 percent of their short sale listings. Three times the national average and that is no typo. Distressed real estate sales demand experience and expertise. We offer both at the same competitive rates as the amateurs. Time is money so call us now, 850-437-5618 or Contact Us.